How can we promote social innovation among SMEs? The promise of innovation audits

By Iuliana Nichersu on Thursday, 30 June 2022.

The DepoSIt project – carried out under the European Commission’s INNOSUP-06-2018 programme – involved developing and testing a new support service scheme aimed at increasing the capability of SMEs across Europe to generate business out of social challenges. The support scheme designed by the DepoSIt partners is an innovation audit tool that includes several questions assessing the social innovation potential of companies. A trained intermediary from an innovation agency supports the company’s top management in carrying out the audit and in understanding its outputs, including charts, a SWOT analysis and a set of tailored recommendations.

What do we mean by social innovation?

Social innovation can be understood in a variety of different ways. For the purposes of the DepoSIt project, we defined social innovation to mean delivering impactful new solutions that meet societal needs, resulting in new social relationships (including beneficiaries) through new products, processes and models. This includes a number of elements:

  • New practice: Social innovation is not necessarily a novel concept, but it must be new to the context.

  • Response to societal needs: The social innovation must primarily aim to meet a societal need, thereby differentiating itself from innovations with societal impacts. An example of an innovation with societal impacts – but not a social innovation – is the introduction of mechanised industrial production, which primarily increased factory profits and labour productivity, but also resulted in safer and higher-paying jobs.

  • Openness to involving diverse actors: Social innovation engages a variety of actors in developing or governing the initiative. New actors can participate, either directly or through a trusted intermediary, to facilitate ownership and alignment of the innovation with their needs. This can also result in shifting roles and relationships and new collaboration models.

  • Social in its ends and means: Social innovation is dedicated to delivering a societal impact in a socially impactful manner.

Our experience shows that there is great potential to support companies (especially SMEs) in understanding the opportunities that social innovation could bring about, in identifying gaps, and in allocating resources to develop social innovation initiatives.

About the DepoSIt project and policy experimentation 

The aim of the DepoSIt project was to understand whether an innovation audit tool which incorporates questions on the social dimension of innovation potential will stimulate business-driven social innovation. This was tested in a randomised controlled trial (RCT) with a cohort of 72 companies in six countries around Europe.

The innovation audit consisted of a three-step methodology which included: (i) an interview with a member of management from the SME, using a standardised questionnaire, (ii) a follow-up interview to present the first results and to develop a SWOT analysis and (iii) a report. The agency used the first two stages results to prepare a report for the company, rating their performance on various areas of innovation and providing analysis and tailored recommendations. The report and recommendations were then discussed in a follow-up meeting with selected companies, held within a month of the initial interview.

In order to evaluate the success of the tool, companies were surveyed three times, before and after the innovation audit process. Six months after the audits were carried out, companies that went through the process were found to have a greater level of awareness of the business potential of social innovation than did those in a control group that had not participated in the audits. There was no evidence of an impact on participants’ knowledge about social innovation, nor on their intention to pursue social innovation projects – although the small sample size meant that the experiment had relatively low statistical power to detect impacts on these indicators.

As well as these survey-based measures, we also examined companies’ websites and social-media accounts to see whether they were talking about social innovation. We found that those who had participated in the audits published an average of 6.2 posts on themes relating to social innovation over the course of a year, compared to 1.8 posts in the control group. This adds weight to the conclusion that the innovation audits had a positive impact on companies’ awareness of social innovation opportunities.

Pros and cons of experimentation

What have we learned from this experience? Here are some key takeaways that might be of interest to other organisations interested in replicating the experiment:

Positive aspects

+ The experiment generated valuable evidence about the promise of the DepoSIt innovation audit tool in promoting awareness of social innovation, something to build on as the tool is further developed in the future.

+ Companies showed themselves willing to participate in the experiment and respond to our surveys – thanks largely to the efforts of the implementing partners to stay in direct contact with companies and motivate them. This led to higher response rates than have been achieved in many other experiments with SMEs (an 89% response rate in the first post-intervention survey, and 82% response rate in the six-month follow-up).

+ The six agencies involved in the implementation coordinated well, making decisions jointly and making sure that the innovation audits and data collection were implemented in a consistent way across countries.

+ Qualitative exchanges before and during the testing of the DepoSIt innovation audit tool allowed innovation agencies to learn from each other’s experience.

+ No independent information sources were available on companies’ approaches to social innovation. The search for keywords on companies’ websites and social media channels was quite complicated to design and implement. However, this data added credibility to the findings and helped the innovation agencies understand the importance of combining and comparing different data sources to achieve reliable results.


– Designing and carrying out an RCT proved to be more complex than expected, and required skills and know-how that innovation agencies do not normally have in house. In particular, an academic researcher was brought on board to provide additional support in data analysis.

– An RCT requires the intervention to be implemented with an adequate size of cohort in order for the results to be reliable and significant. In this experiment, the sample size of 72 (of which 30 were randomly selected to participate in the innovation audits) was only just sufficient to provide robust results.

– There were challenges with keeping companies motivated to respond to our surveys – in particular in the control group, who did not receive any treatment. If the value to them is not clear, companies are understandably reluctant to spend time providing data for an experiment.

We’ll be talking more about social innovation and the results of the DepoSIt project at IGL’s online public event on 6 July. Click here to register and hear more! And you can find out more about DepoSIt at